Is there a Catch to selling cars like this?

Question

Lately, I've seen dealers advertising that you can buy a brand new car for $88 down and $88 a month and another ad for $57 and $79 a month. Is there a catch to this? I think it would be great to have low payments like that, but I'm a bit skeptical. I heard you can do 72 months which is a bit long, but again the price is so low. Can someone explain this process to me?

Answer 1

Payments that low sure sound like lease payments to me, and they would only be that low on cars they really, really need to get off the lot, like, maybe a pink Neon, or 2005 or 2006 models they couldn't sell.

Answer 2

A couple of the local scumbag dealers by me do this as well. Of course there is a catch:

-balloon payments
-the last payment is about half of the loan value
-huge downpayments
-72 mo loans
-rebates, incentives and credit card dollars maybe 2 people on earth could qualify for
-military rebates
-owner loyalty rebates
-$3000 in earned GM Visa/Mastercard rewards

I have seen any and all of the combinations above. Just read the fine print, and know that all dealers pay about the same amount for a new car. You will also rarely get the best price from a used car dealer.

Answer 3

Check the fine print. Most of these offers are only low payments for a short time,then payments go up drastically,3-6 months is usual for intro period. 72 mos @$88 plus $88 down is only$6424,not nearly enough for a new car,esp if u figure some of that has to be interest and fees.

Answer 4

You pay financing. Usually the less you pay down, and the longer the payment plan is set to last, the more financing you pay. Also they take the car back if you start missing payments. The car breaks down as much as your old car, but all the repairs cost more. Miraculously your car fails to run, but the part that broke is not covered under powertrain. In fact dozens of stupid things break all over the car but none of them fit into the classification of "bumper to bumper" [:O]

Answer 5

You can do this but they're usually either high interest loans or leases which end up screwing you over later. Look into it more, I'm sure there are some legit ones but be careful of the lease, especially if you plan on driving your car often (you're not allowed to put on many miles) or if you want to keep your car for a while.

Answer 6

when i bought my car i was looking for the best deal, just offer the expensive not so hot cars then down grade to the middle expensive, show them something not as hot as the next car you will then offer call it your best deal and offer the least expensive, saves on gas, etc........, kind of deal and blam the sale is most likely yours, but you have to make sure the cars almost or better than the first and second offers. But you got to offer a variety to choose with all the options we can afford. that's how i bought my car anyway. Always buy new if and when you can with extended warranty purchase not leased. Works for me anyway.

Answer 7

It's probably a balloon loan.... the last payment is like $8000 or something, which you end up financing for another 72 months. You'll end up paying over $10K in finance charges alone.